Property Investment Education or Developers Sales Agents?

Don’t be Fooled

We have noticed a change in the property investment education sector in the last few years which is catching a lot of people out. There are a lot of everyday Kiwis who realize the benefits and opportunities that investing in property can bring them, and how this can give them and their families a much brighter future. Most of these people are simply looking for the knowledge and expertise so they can do it right.

Wolf in Sheep’s clothing

What we have seen is a growing number of so-called property education companies enter the market with big budgets and polished social media and marketing. These companies have a very slick model which appears straight forward on the surface, but in truth, it is a trap for anyone who wants to build true wealth in property.

If you dig a little deeper, you will discover that the education is designed to lead you towards a particular outcome; buying one of their own development properties.

How they do it

These property investment education companies are backed and funded by property development companies. Because there is big money to be made by the developers selling off their stock, they fund everything. This is the reason the education company will offer you all their training for free!

You’ll find that the “free” training offered by the property education company is often very basic and limited. It gives you just enough of the “juicy bits” to get you interested but leaves out everything else, because their ultimate goal is to sell you one of their development properties.

They will do this by:

– Telling you the best location to buy, – This is where their developments are!
– Organizing your finances
– Organising your insurance and property management
– Only Showing you specific developments (theirs)
– Negotiate an ‘amazing deal’ (market price or higher)
– Finally, sell you a development property

What they don’t tell you!

– Most of the development property is brand new Apartments, Townhouses or
Stand-alone houses which are highly negative cashflow!
– Because these properties are negative cashflow, you will only be able to
purchase 1-2 maximum, and these will bleed you dry of cashflow over time
– None of the property will be below value, more likely market value or higher!
– There is a high chance the location is flooded with similar developments
pushing down demand and prices
– The location will only be where the developer has targeted quick sales; not
long-term growth!
– The only way to profit from development property is capital gain. If there is no
capital gain for several years this can severely handicap your finances
– If the market goes backwards, you will have negative equity!
– Because the market could be flooded, capital gains may not happen for years,
or in some cases decades
– The property education company gets paid a commission by the development
company for every property sold

Summary

Most people that are lured into this sales process are over the moon that they are “on the property ladder” and headed towards making great wealth, only to find down the track they have purchased an overpriced property which is negative cashflow. Sadly, they finally realize a few years later this property game isn’t for them and they decide to sell up, quite often at a loss.

Get Educated first, then Take Action

If you are interested in property investment and want to know how to go about it confidently and with expert guidance, then you need to get educated before you act. Buying investment property when you don’t know what you’re doing can lead to very expensive mistakes.

Our Mentoring Programme covers everything you need to know to be a successful property investor. You will learn the skills to independently assess investment opportunities in the market and identify undervalued, positive cashflow property all over New Zealand. The best part is if you’re ever unsure, you’ll have an expert who you can turn to for a second opinion.

You can join our mentoring program – Click Here

If you still have questions or want to meet Shane face to face before you sign up, you can book a 30-minute call with Shane to discuss the mentoring program and whether it is right for you.